Regional pay contributes to recession

There is no evidence that regional or local pay deals for groups of workers such as teachers, nurses or bin collectors will lead to more jobs.

The New Economic Forum was asked by the TUC to analyse the government’s case and to point to the possible impact of the policy of cutting wages for public sector workers in some regions.

It estimated that the introduction of regional pay could lead to a £10 billion loss to the economy and the loss of 110,000 jobs. Even using the government’s own assumptions, in the best case only 11,000 more people would find jobs but there would be a £2.7 billion reduction in spending in the areas affected.

The ConDems have not studied the impact of their plans. They clearly do not care. Overall they will end up reducing the total wages bill both regionally and nationally. This will lead to public workers spending less in the shops, depressing the economy.

In Parliament parties outside the coalition have opposed the regionalisation of pay. Even 25 Liberals and 6 Conservatives who represent constituencies where the government intends to cut pay have voiced their concerns. 100 MPs have signed an early day motion to have a debate on the issue.

This vindictive policy is a deliberate attack on workers’ wages, which in the long run will also damage profits if it contributes to the recession by cutting spending.

Poor benighted creatures, these capitalists. They can’t always make their system work for themselves. Why should we workers, the 95%, continue to let them ruin our lives?


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